Multi-currency travel wallet YouTrip announced last week that it has raised $25.5 million in its pre-Series A funding round. Insignia Venture Partners led the financing with undisclosed family offices and angels making up the remainder. The Singapore-based startup plans to use the new capital to expand its app-and-debit-card service beyond Singapore to more areas in the Southeast Asia region.
YouTrip’s digital travel wallet makes it possible for users to purchase goods overseas using more than 150 currencies without any hidden fees and at wholesale exchange rates. The service boasts no cross-border or transactions fees, with just a small fee for ATM withdrawals. First launched commercially in August 2018, YouTrip has registered over 200,000 downloads of its app with over one million transactions, according to co-founder and CEO Caecilia Chu. Both the app and the linked card are backed by Mastercard and integrated with contactless payment service EZ-Link.
The success of YouTrip’s pre-Series A funding round points to a broader trend: the use of fintech in travel. As fintech continues to expand, many companies in the travel sector are finding ways to incorporate these technologies into their business models. Challenger bank services like YouTrip are already common in Europe with its unicorns Monzo, N26 and Revolut. However, the possibilities of fintech and travel go beyond such banking services.
For example, Chinese conglomerate Alibaba launched its smart technology-integrated hotel FlyZoo in Hangzhou, China last December. By utilizing data analytics and artificial intelligence, Alibaba is hoping to create a smoother and more enjoyable hotel experience through rooms that automatically unlock upon your arrival, lights and thermostats that adjust by voice command, room service orders that are taken via AI (and delivered via robots), and more.
Of course, as travel services start to increasingly utilize fintech, there are challenges to be faced. A reliance on big data and AI algorithms can potentially open up the possibility of a data breach such as what happened to Marriott and Target—with significant consequences. For both YouTrip and Alibaba, these concerns must be at the forefront if they hope to successfully expand into other markets.